If you own a business that would need the use of vehicles to go from point A to point B, you might be wondering now whether to lease the cars or not. There are two kinds of car leases—the financial lease and the novated lease. The former is a straight-up renting of the vehicles where you take full charge of your fleet’s maintenance. The latter involves having a company lease a vehicle on your behalf, if you’re an employee, where that company takes all the responsibilities such a lease entails.
Leasing vehicles offer some advantages. Leasing a vehicle can save some money for your business by allowing you to use the cars without paying the huge sums of a purchase, thus providing you with some financial flexibility. Vehicles that are under novated leases can help reduce the tax you pay, as your pre-tax income is used to pay for the said leases, effectively reducing your taxable income.
Leasing a vehicle also gives you the option to look for newer models after a leasing period has ended, granting you the opportunity to have your pick among better, different, or later models or brands for company use.
Consider these leasing advantages when you’re on the fence about buying or leasing.